The Depository Trust and Clearing Corporation (DTCC), the main U.S. clearinghouse for securities transactions, has recently announced its partnership with the ERC-3643 Association to advance Ethereum-based tokenized securities. This move signifies DTCC’s increasing involvement in blockchain-based financial solutions and its commitment to promoting Ethereum’s ERC-3643 standard for permissioned securities tokens.
ERC-3643, also known as the T-REX protocol, is an open-source smart contract standard specifically designed for issuing and managing permissioned tokens. It ensures that only authorized users, even on public blockchains, can hold these assets by utilizing a decentralized identity framework. More than 40 tokens have already been developed and managed using this standard, tokenizing a total of $28 billion worth of assets across over 180 jurisdictions.
The integration of ERC-3643 into DTCC’s ComposerXTM platform, which includes ComposerX Factory, a tokenization engine for managing financial data, aims to enhance risk management, security, and compliance in digital asset markets while reducing operational costs and complexity. By linking real-world assets to a broader range of market participants, ERC-3643’s automated procedures are expected to improve liquidity, speed up settlements, and increase transparency in the market.
Nadine Chakar, Global Head of DTCC Digital Assets, expressed the corporation’s commitment to the ERC3643 token standard, stating that it aligns perfectly with their vision of creating a more efficient and secure financial market. DTCC, which processed $3 quadrillion in securities transactions and held $85 trillion in assets across more than 150 countries in 2023, has been actively exploring blockchain applications, including tokenized private asset tokenization on an Avalanche (AVAX) subnet and tokenized U.S. Treasury Bill settlements on the Canton Network.
The support from DTCC for blockchain-based finance indicates a growing receptiveness among American regulators towards this technology. In a related development, the Commodity Futures Trading Commission has also been exploring blockchain applications and recently announced a pilot program for digital asset markets, involving prominent industry leaders such as Circle (USDC), Coinbase, Crypto.com, MoonPay, and Ripple (XRP). The initiative will test stablecoins and other tokenized non-cash collateral.
Overall, DTCC’s collaboration with the ERC-3643 Association marks a significant step towards advancing Ethereum-based tokenized securities and integrating blockchain technology into traditional financial systems. This partnership is expected to drive innovation, efficiency, and security in the digital asset market, ultimately benefiting market participants and investors alike.